Another top union official forced out

Nick McKenzie and Richard Baker

Another Victorian building union official has been forced out over corruption concerns at a state government site, as his state secretary, John Setka, on Wednesday night rejected an allegation that he received free work on his home.

Fairfax Media has confirmed that a top union official working at the Bendigo Hospital redevelopment was recently dismissed by Construction Forestry, Mining and Energy Union leaders after an internal probe into claims he received gifts from a contractor. It is believed Victoria Police and the federal government's Fair Work Building and Construction inspectorate are aware of the Bendigo allegations.

The revelation comes after another CFMEU organiser, Danny Berardi, quit the union earlier this week after Fairfax Media exposed that a Melbourne construction industry company provided free work on his house.

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Mr Setka rejected a claim by Melbourne builder Andrew Zaf that he provided a free Colorbond roof on the union leader's house in the mid-1990s.

Mr Setka was a union organiser at the time.

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Mr Zaf, a former bankrupt builder, made the allegation on the ABC's 7.30 program, saying: ''He basically received a free house roof, a Colorbond house roof, insulation, you name it.'' Mr Zaf described this arrangement as a ''bribe'' and said he did it to ensure ''peace and quiet'' for his business.

He also has made the allegation to the state government's Construction Code Compliance Unit in 2012.

In a statement, Mr Setka said Mr Zaf's allegations were ''lies and I totally reject them''. He said he bought roofing products from a business Mr Zaf was associated with at ''trade prices''.

''The claim that there was some deal or agreement or any flow-on benefits is a blatant lie,'' Mr Setka said. ''I have never been approached by the CCCU or any other authority in relation to those allegations.''

Mr Zaf also alleged that in the early 2000s, he employed asbestos specialist Helen Bouzas - who was Mr Setka's girlfriend at the time - on several projects.

He claimed Mr Setka intervened in one business deal that turned sour, demanding he and his business partner pay Ms Bouzas a disputed debt.

Mr Zaf claimed that Mr Setka told him: "You will pay the lady.''

Mr Setka has also been more recently involved in a $2.4 million property development at Seddon in Melbourne's inner-west. There is no suggestion of any impropriety connected to this project.

However, some of Mr Setka's union colleagues are privately uncomfortable with the image of a senior union figure becoming a property developer, suggesting a potential conflict of interest could arise when workers on the site come from construction companies that require union support to win work on major building sites.

The only paperwork linking Mr Setka to the Seddon project is a 2008 caveat. By 2009, all development paperwork was in the name of a company, Pursuit Developments, directed by Mr Setka's teenage son.

Mr Setka's joint venture partner in the development was his close friend Frank Prevolsek, a labourer and bricklayer who during the life of the Seddon project was employed by several major construction companies in Melbourne's CBD as their union shop steward.

The union has also been promoting the use of a safety product on city construction sites that is made by a company owned by a close associate of Mr Setka.

Jadran Delic has been a fixture in Melbourne's building industry for many years. Court records show he previously admitted to putting assets in his wife's name in order to avoid payouts to any union members injured on his sites.

Describing the arrangement in court, Mr Delic said: "Cos I'm in the building game and the way the unions work at the moment, that any of your workers can sue you, if they fall off or you know they hurt themselves, so they can sue you."